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How firms have changed in the last five years and future predictions

25th Mar 2024
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Bright was created in 2021 when Thesaurus Software Ltd. and Relate Software Ltd. decided to join...
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The past five years have gone both quickly and slowly at the same time. On the one hand, it’s hard to believe that it’s been half a decade since the pre-Covid world of 2019. On the other, with developments in technology, AI, and working culture moving at breakneck speed, time can feel like it’s flying by. 

With that in mind, it’s useful to pause for a moment to reflect on how far things have come in the past five years, looking at what’s changed for the accounting industry and why, and explore where they might be heading in the years to come.  

Here’s our overview of some key changes between then and now - with a forward look at what might be next, too. 

Technology and AI  

Let’s start with the big one. Five years ago, Chat GPT wasn’t a common phrase - in fact, chances are most people had never heard of it. Now, it’s dominating headlines, sparking conversation about the value of human experience versus robot efficiency, and changing the way businesses and individuals go about their daily work.  

That’s not to say, though, that technological transformation and developments in AI weren’t on the scene in 2019. In fact, at the time, 90% of accountants felt the profession was undergoing a ‘cultural shift’ and leaning more towards tech - with 58% expecting to automate tasks using AI within the next three years. On that front, they weren’t far wrong.  

Today, as robotic process automation (RPA) uses AI to complete repetitive tasks quickly, and cloud accounting software becomes the norm, accountants’ mindsets are switching from ‘routine work’ to ‘strategic thinking’.  

With spreadsheets now firmly (okay, mostly) in the past, relying on technology to facilitate in-depth data analysis and predictive modelling means accountants have the opportunity to develop new skills and services - based on complex data analysis.  

With this comes a move towards providing clients with actionable insights that can help them make smart, data-led decisions, rather than simply handling compliance obligations.  

The role of accountants  

With the acceleration of technology and AI comes a fundamental shift in the way firms are able to support clients. As a result, over the last five years, the line between accountant and business advisor has become significantly more blurred.  

This blurring has been happening for a while - experts have been saying accountants needed to move towards advisory “or become glorified bookkeepers” as early as 2015, and the role of the profession has likely, in reality, been in flux since it started.  

But, in 2024, the extra time that the ability to let tech do the number crunching and error spotting affords, combined with the challenging situation lots of businesses have found themselves in over the last few years, has accelerated that change in role. 

During the pandemic, accountants became critical strategic advisors for businesses - explaining concepts like furlough, helping identify areas to save costs, and often acting more like a virtual CFO than a traditional compliance expert.  

In many cases, the cost of living crisis has cemented that relationship, and both sides are seeing the benefit of a more strategic, forward-looking dynamic - and don’t want to look back.  

Changing practice culture 

Back in 2019, the accounting profession didn’t have a reputation for being the most modern or forward-thinking industry. Traditional ways of working, bricks-and-mortar offices, and location-based client acquisition strategies were common-place - particularly when compared to the culture of start-ups or agencies.  

Now, that’s changing. Firms have found that both clients and employees often like the hybrid and remote working culture ushered in by the pandemic - and that it can work wonders for growing their practice, both from a recruitment and a client perspective.  

With Zoom meetings, practice management software that facilitates easy communication and real-time file sharing, and a greater online presence overall, clients can communicate with their accountants easily - regardless of location. That means that - from both sides - the focus can be around best fit, experience, or services, rather than geography. 

The same applies to recruitment, which is particularly important in the current hiring landscape. Firms that adopt hybrid and flexible working policies are widening the scope of their talent pool, increasing their attractiveness as an employer, and capitalising on the ability to look for specialists in other regions of the country.  

Understanding the changes 

The pandemic - with its restrictions, lockdowns, and realigning of priorities for lots of people - has, of course, played a huge part in ringing in some of the transformation witnessed over the past five years.  

It forced tech-hesitant firms to take a leap with digital communication, created a whole new working culture, and removed some of the formality previously inherent in accountant/client interactions. After all, it’s hard to maintain professional distance when your cat’s brushing past your screen on a call, or your client’s juggling home-schooling with running a business.  

The subsequent, broader economic landscape of the early 2020s - with a cost of living crisis, recession, Budget U-turns, and moving regulatory goalposts - has also contributed to the changing role of the accountant in 2024.  

To survive, businesses have needed proactive, forward-thinking advice from experts that can help them forecast accurately - focused on real-time advice, rather than historic data. By embracing tech that allows them to free up time by automating unnecessarily mundane or repetitive tasks, accountants, who already have the perfect skillset to do so, have been able to move towards meeting that demand.  

What happens next? 

It’s likely that advancing tech and AI will continue to bridge the gap between the old way of working and new. Infact, according to a KPMG survey, 65% of US CFOs believe generative AI will have a high or extremely high impact on accounting in the next three to five years.  

As it becomes more sophisticated, accountants that embrace tech and AI may outperform those that don’t in terms of service, efficiency, and value to clients. By 2029, perhaps manual data entry will have become a thing of the past entirely. 

It also seems a fairly safe bet that clients’ expectations of a tech-forward experience will continue to grow. And, as accountants increasingly utilise software for services like payroll or tax and compliance, they may find themselves taking a lead on training clients to use that software, too - in order to enable a relationship that consists of real-time, insight-driven conversations.  

To highlight some wildcards to keep an eye on, there’s also the Metaverse, which uses virtual reality (VR) to allow users to interact with businesses in a virtual world. Several accounting firms have already set up shop to operate in the digital space.  

Blockchain technology, too, is already transforming auditing and record-keeping, and the next few years could see this harnessed to streamline accounting processes and further reduce risk of error or fraud.  

If the past five years are anything to go by, it’s hard to predict the specifics of what might happen next, though the above developments seem likely.  

What is certain, though, is that, to truly offer value to their clients, the accounting profession will need to continue to adapt in an agile way to changes as they come - even if that means embracing a future that, to some extent, involves robots. 

If you’d like to find out more about our Bright software suite, please contact our team - we’d love to hear from you.  

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 Written by: Bright

 

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